Since 2011 Oracle (ORCL), an enterprise IT services firm, has been fighting litigation filed by Hewlett Packard Enterprise Company (HP) accusing Oracle of a laundry list of violations. Not only did HP accuse Oracle of breach of contract for announcing it no longer planned to make software for certain HP servers, HP also accused Oracle of violating a settlement agreement between the companies.

The case also involves allegations of trade secret theft related to Oracles’ poaching of ex-HP CEO Mark Hurd. In 2016, a California jury awarded HP $3 billion in damages and post-judgment interest. Three months before filing its latest 10-Q, Oracle lost an appeal. A month later Oracle lost again when it asked the same court to take another look. Six weeks ago, Oracle appealed the case to the California Supreme Court, the last legal arbiter in the dispute:

“If the Court of Appeal’s judgment is ultimately affirmed, we would be liable for the amount of the jury award that is described above plus post-judgment interest.”

Excluding a decade’s worth of interest, $3 billion is nearly equivalent to the current quarter’s operating income of $3.4 billion. As of the company’s last 10-K, no reserve had been recorded in connection with the litigation. If Oracle is ultimately liable, not only will the jury verdict negatively impact cash flows but also the company’s reported earnings.